1MDB gatecrashes party for new Malaysian sukuk

Federation of Malaysia returns to the international bond markets as state-owned fund, 1MDB, faces looming cross-default across its $11 billion outstanding debt.

The Federation of Malaysia returned to the international bond markets on Wednesday with a $1.5 billion wakala sukuk whose success will almost certainly be overshadowed by the gathering storm engulfing state-owned 1Malaysia Development Berhad 1MDB.

The investment fund faces a cross-default across its $11 billion outstanding debt after one of its guarantors failed this Monday to make a $50 million interest payment on a $1.75 billion note that matures in 2022. It has...

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